Welcome to Retirement Intelligence 101, a series on how to retire.  We will first define what it means to be retired by listing a few details that describe the state of being retired.  Then we will define what you will need in order to be retired.  Then we will discuss what you can do to get what you need in order to be retired.  1. How to get 2. what you need 3. to be retired.

As a Legal Disclaimer: None of this is financial advice so don’t sue me.  Evaluate what you read with your own judgment. I am just sharing my thoughts and opinions.

Let’s dive into Step 1.

What it means to be retired to me is you have the following taken care of for the rest of your life:

1. Necessities (Food and water, Shelter).  You will never have to worry about being able to afford some form of this in order to stay alive (quality of food/water/shelter is not guaranteed)
2. Emergency Protections (Insurance premiums paid for, budget for emergency expenses). You are unlikely to have major expenses come up like going to the hospital and getting a large bill, but if they do you are prepared for the bill because insurance will pay a lot of it and your emergency savings fund will pay for the rest of it.
3. Inflation.  You don’t have to worry about becoming poorer over time due to inflation. (Google for “Inflation” to learn more)
4. Your life improves over time. You won’t be stuck in the same lifestyle for the rest of your life.  As you age, you get more money and you can buy more and better things.
5. Budget for fun. You have money to do what you want, and over time you get more money to do what you want.

And the key point is all of this is possible without you doing any work as an employee. 0 work as an employee, you get this. For the rest of your life. That is retirement. It’s also financial freedom.

We can add up the budget for all 5 categories to come up with the total amount of cash you expect to be able to spend per year.  Let’s say it’s about $51,000 based on the spending of an Average American (article here) which is $64,000 per year before taxes.

To retire you will need to somehow get $64,000 per year before taxes.  Without working.  How do you get money without working?  Stay tuned for the next post where I tell you that answer!

To find out when more life education writing is released, subscribe on the side! Follow on Twitter, on Facebook, on Google+, on Tumblr.

Subscribe to receive more advice to improve your life! Follow on Twitter, on Facebook, on Tumblr.